Legacy Group banks: Depositors start getting their money from PDIC

CEBU, Philippines - The Philippine Deposit Insurance Corporation has started processing the claims of Legacy Group of banks depositors and everything went smoothly.

“So far hapsay kaayo. Walay labad sa ulo,” said Ferdinand Beluan, PDIC department manager III for Receivership and Liquidation.

PDIC is a government-instrumentality attached to the Department of Finance. Its main role is being a deposit insurer, co-regulator of banks, receiver and li-quidator of closed banks.

Beluan said that it would take several weeks from now before depositors with over P100,000 in the bank can get their claims as those with deposits of smaller amounts were the ones given priority.

According to PDIC, based on available data from the 12 closed banks of the Legacy Group, depositors with accounts that have P100,000 and below represent about 62 percent of the total deposit accounts of more than 130,000.

Of the 12 banks, five of which are located in Cebu — the Pilipino Rural Bank and all its branches, the Rural Bank of Bais (Supreme Bank) in Mandaue City, Rural Bank of Carmen in Carmen, Cebu, Philippine Countryside Rural Bank and all its branches and the Bank of East Asia in Minglanilla, Cebu.

All these banks declared bank holidays beginning December 8, 2008.

The banks under the Legacy Group have been found by the Banko Sentral ng Pilipinas (BSP) to be undercapitalized by P2.5 billion.

PDIC was then designated by BSP to act as a receiver of the embattled banks.

PDIC’s prioritizing the claims of depositors with regular savings accounts of P100,000 and below is in keeping with the state deposit insurer’s mandate to protect small, unsophisticated depositors.

Beluan further said that so far there is no indication that the management of these banks will opt for bank rehabilitation.

Bank rehabilitation is a process whereby a closed bank is allowed to rehabilitate its operation upon a favorable endorsement by the PDIC to the BSP.

However if a close bank will not resort for rehabilitation, PDIC will have the bank assets liquidated in order for the bank to pay its depositors.

PDIC will only pay up to P250,000 of the deposits for each depositor as mandated by law. Beyond the said amount, the bank’s assets after liquidation will be used to pay.

So far, Beluan said they have not processed yet the Legacy Group of banks assets as they are still in the receivership stage. — Mitchelle L. Palaubsanon/NLQ (THE FREEMAN)